AgriVisor Morning Marketwatch

Thursday, November 01, 2018
   ***Good Morning***

***** Grains are mixed to start the day; soybeans 2 lower, corn 1 higher, and wheat 3-4 higher. ***** 

   # In lieu of other big news, today’s export sales numbers will probably dominate the early attention, especially in the wake of recent slow sales weeks. Corn and wheat sales continue to disappoint.  455,800 tons of soybeans were sold last week.  399,400 tons of corn were sold.  Soymeal sales, 321,700 tons were good.  Wheat sales, 582,500 tons were better than expected. Grain export sales have been notably smaller ahead of USDA reports the last couple of year, with the last key report for row crops for a couple of months coming next week.
   # Ukrainian wheat exports through Oct. are 7.5 mmt., about 0.5 mmt behind last year.
   # After a small initial delivery against Nov. futures yesterday, they were sharply higher today, and toward the higher end of expectations. 813 contracts were tendered today.  However, there might have been a couple of potentially good stoppers.
   # Weather forecasts could be mildly supportive, with the 7 day and 6-10 day outlooks both including good moisture potential.  Furthermore, temps are expected to stay on the cold side slowing drying and late harvest. The 8-14 day outlook shifts back to normal precip, but stays cold.
   # Another one of the ships that sailed for China with soybeans has been re-directed to S. Korea.  That still leaves 1 known to have been loaded with soybeans last week still headed to China. It’s said there are 2 ships at one port thought to be loaded with soybeans just sitting. 
   # There was a new story out of China suggesting the much talked about curtailment of protein levels in hog feed may not be occurring, and may not occur.  One analyst said the lower protein rations may alter feeding patterns, patterns that effectively raise overall protein demand. Instead of a 14 mmt. reduction in soybean usage, 5-6 mmt. may be more realistic. 
   # OilWorld currently thinks Chinese soybean imports will be down 11 mmt. this year. One the other hand, Bunge only sees a small reduction. 
   # EPA has sent its final biofuel blending proposal for 2019 to officials for final review.  It’s thought they proposed a 3% increase. 
   # USDA is said to be set to release their 10 year benchmark forecasts tomorrow.  These are primarily used for budget development purposes, and have little market relevance. Still, the trade will note acreage estimates for the coming year, along with longer term price forecasts. Still, don’t expect much market reaction.
   # Argentine weather continues to be a little dry to the north, with showers still set to the south. The drier north is said to be hurting wheat potential a little. In Brazil, shower potential continues to dominate much of their producing areas, with precip a little heavier in the south than the north. 
   # Funds were said to have sold 7000 corn, and bought 5000 soybeans and 1000 wheat yesterday.
   # Global equity markets are stronger today, with most following the lead of yesterday’s stronger U.S. market.  Still most of the commentary seems focused on Oct.’s decline and what it portends for the future. Buoying hopes for a Brexit deal helped bolster equity markets along with some better earnings numbers.

***** Cattle should start the day steady/higher; Lean hogs mixed. *****  

   # Wholesale beef is higher with choice at $216.93. The cash trade has remained quiet this week, but there’s increased talk prices might hold last week’s late gains, keeping steer prices near $115. Persistence of higher wholesale beef values is the biggest plus.  Beef export sales, 25,300 tons, were better this week. 
   # Wholesale pork is sharply lower at $76.05. Cash hog prices are expected to be steady/$1 lower today.  Export activity is a little better this week with 21,800 tons sold.